By James Pomfret
TAIPEI (Reuters) - Taiwan's presidential poll this weekend is the focus of much international attention, but the concurrent election to the island's combative parliament will have almost as much impact on policy change and the pace of integration with mainland China.
Taiwan's 113-member parliament is known for its boisterousness and sometimes fisticuffs and all-out brawls, but it has also spearheaded the island's transformation from a dictatorship to a beacon of democracy in a Chinese society.
This year, with opinion polls predicting a close contest between the ruling Nationalist Party and the opposition Democratic Progressive Party (DPP), the likelihood of a hung parliament -- and a subsequent policy slowdown -- is high.
"There's some difficulty for us, but perhaps both parties won't get a majority," said Gao Jyh-peng, a DPP veteran campaigning in a gritty Taipei suburb draped with giant 10-metre-tall posters of him grinning in a Che Guevara T-shirt.
"If we get a majority, at least we can, to a certain extent, block policies," said Gao, strolling through a market, shaking hands with hawkers and housewives and followed by a bevy of young supporters handing out campaign flags.
The closely-fought elections on the island that is claimed by China and is an ally of the United States could rattle Sino-U.S. ties in a transitional year for Beijing, where a leadership succession is due to take place late this year, and perhaps Washington, where President Barack Obama is seeking re-election.
For Gao and other grassroot politicians, the geo-strategic implications are overshadowed by bread and butter issues like jobs, homes and the cost of living.
But if the Nationalists do not retain a majority it could mean a scaling back of the party's pro-China policy, which has drawn foreign investors because of benefits to export-dependent Taiwan just as the global economy looks set to slow and crimp growth.
Nationalist President Ma Ying-jeou has a slight edge over his main opponent Tsai Ing-wen of the DPP in the presidential polls, but even if he wins, control of parliament will be crucial.
"If we do have the different branches of government controlled by different parties, that could potentially be a problem in terms of both moving forward on some of the key legislation, and also in terms of getting any major reforms implemented," said Ray Wu, an academic at Taiwan's Fu-Jen University.
China and Taiwan have been ruled separately since the Nationalists fled to the island in 1949 after losing control of the mainland in a civil war. Beijing has vowed to bring Taiwan back under its rule, by force if necessary.
Despite fighting the Communist Party in China's civil war, the Nationalists are now seen as closer to Beijing and more inclined toward rapid economic integration. On the other hand, China views the DPP as independence-leaning and mistrusts Tsai, even though she has tempered her party's anti-Beijing stance.
Ma's Nationalists won 81 of 113 seats in parliament four years ago, allowing him to push his groundbreaking economic and trade rapprochement with China that markedly improved cross-strait relations.
But this year, opinion polls suggest an exceedingly close race, with the most likely outcome a narrow majority for the Nationalists over the DPP.
"The Nationalists should have a relatively better chance to get a majority, but it won't be possible to get over 70 percent like in 2008," said Wang Yeh-lih, head of the political science department at National Taiwan University.
"The DPP will also be able to increase its number of seats but it won't be easy for them to get over half the seats based on the candidates they've put forward and the support in various districts."
A tight outcome could mean Ma would be dependent for support on the People First Party, the third force in the elections. The party is a offshoot of the Nationalists and shares a similar platform, but its leader, James Soong, is critical of Ma.
Despite trailing a long way behind in the polls, the party may get enough seats, at the Nationalists' expense, to hand it a kingmaker role in the next parliament.
"We're going to ... see to it that any winner should not monopolize the political process in making any decisions which will have a negative influence over the future of Taiwan," said Soong, campaigning on Wednesday dressed in a dark suit and a blazing tangerine party tie.
"We're going to assert that crucial, key minority position."
(Additional reporting by Jonathan Standing; Editing by Brian Rhoads and Raju Gopalakrishnan)